“I think it’s difficult for any industry when you get a negative situation or anything that is potentially environmentally problematic. I think one needs to keep an eye on the reality that after all the fuss of Cougar Energy’s Kingaroy incident, at the end of the day there was no real incident and potentially one needs to think that maybe that will be the case again here.

The Queensland government reaction to Cougar was a gross over reaction by the regulator and one needs to go through the process of testing and analysing the background for what at the end of the day is a more than manageable event.

At the end of the day, you just hope it works out for the best – even though the [coal seam gas industry] have been less than kind to the UCG sector over the last couple of years. I don’t believe you shut down drilling. I believe you analyse the problem and resolve it just like you do in every industry.

The regulator needs to have a calm head when these instances occur."

Grahame Baker, senior adviser at Resource and Land Management Services, a Brisbane-based environmental and land management consultancy:

On the detection of cancer causing agents known as BTEX in fluid samples from coal seam gas wells:

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“The timing is definitely unfortunate. But the companies are doing absolutely detailed analysis and are finding things. These are very fine traces. If you go to any dam and test it, or any public water supply, you’ll find an amount (of BTEX). These are a natural part of petroleum fuels. They have been used in special cases as a fraccing [drilling] fluid but they are not used in the coal seam gas industry.

“I suspect the contamination has nothing to do with the ground water, but is something to do with the drilling rig" or from a motorised pump used at a water-collection dam.

“It’s great for a media story but it doesn’t help the industry."

“The reality is the risk is almost zero but it doesn’t help the perception. It generates the question, what is federal Environment Minister Tony Burke going to do on Friday" when he is due to rule on the environmental approvals on the BG and Santos projects.

MERRILL LYNCH, analyst James Bullen:

“The timing of this notice is poor for
Santos
given they are expecting a decision regarding the environmental approval of GLNG on October 22. The detection of BTEX will likely be picked up by opponents to push for further approval delays. We believe that any delay will be short and that this will not be a show stopper for the developments."

MACQUARIE PRIVATE WEALTH:

“These are potentially serious issues, and this release is likely to cause some nervousness in the market. But [there is] little real cause for concern. The leak is likely to be caused “merely by contaminated equipment. Given the traces of BTEX are so small and have only been found in eight wells (out of hundreds) points to a very localised issue."

But the timing is “not good" given the federal government is only 72 hours away from the environmental sign-off of the BG and Santos CSG-LNG projects.

“We, however, are confident that the relevant decision makers will recognise the isolated nature of this incident. As a result we do not expect this news to affect the federal government’s ultimate decision or the future of CSG-to-LNG."